A favorite debate focuses on the ascension of digital marketing over traditional marketing in today’s marketing model. Too many companies, even in the technology sector, still seem unable to grasp that such a transformation is taking place.
Perhaps the issue is that, even now, spending on analog/traditional marketing continues to exceed spending on digital marketing by a significant ratio according to Gartner Group’s 2013 U.S. Digital Marketing Spending Survey. Based on the survey, average marketing spend as a percent of annual revenue, across all industries, is 10.4% while digital marketing spend is 2.5%.
It should be noted that analog marketing tactics continue to be more expensive than digital options – media advertising being just the most obvious example. Had the survey been broken down between B2C and B2B companies/industries, my guess is that analog and digital spending would be on a more even spending arc.
A related trend - how the advent of the digital marketing technologies that are reinventing much of the marketing model have altered the dynamic between CMO and CIO – is also highlighted by the results of the survey. The CIOs of those same companies have seen their budget decline to 3.5% of annual revenue and with digital marketing spend at that 2.5% level, parity in technology-related spend seems not too far away.
In fact, in a 2012 report, Gartner predicted that by 2017, the CMO's technology budget will exceed the CIO's. Pretty much every business should broadly consider itself a digital business but, right or wrong, marketing has emerged as the de facto owner of digital. That makes the CMO responsible for driving the organization’s digital transformation, which clearly is built on many of the emerging technologies that are changing the conduct of business – mobile, social, cloud, SaaS/PaaS/IaaS.
SaaS and cloud technologies have had much to do with the changing balance of power between the two functions. The ability to bypass the CIO organization to access key marketing technology platforms/solutions with ease in the new environment allows marketing leadership, or any other functional leadership, to avoid the traditional IT development/procurement queue and execute much more quickly on critical initiatives.
This would all seem to set the stage for the emergence and confirmation of the digital CMO, a marketing leader that not only recognizes the inevitability of this transition in the marketing model, but embraces and builds an organization to take greatest advantage of the new digital/social/mobile media. Marketing strategy is still marketing strategy. It is the tools, technologies, and channels that have been disrupted. If there is a crossing of the Rubicon occurring in marketing today it is probably better to start thinking and acting digitally now than learn in some harder, and perhaps more final, way.